Alternative Payment Models – Payment Transformation in Healthcare

Payment models have been transformed in the healthcare industry. The changes came about because of a need for new cost-effective payment models, which had the potential to accelerate the adoption of new technologies and streamline patient access to care.

Many businesses are experimenting with different payment models to keep up with the ever-changing customer preferences. Digital Transformation in Healthcare has been slow to change, but now they are catching up. We'll explore how healthcare providers are adopting alternative payment methods and the problems they hope to solve.

Accountable Care Organizations

Accountable Care Organizations (ACOs) are a type of managed care organization that is accountable for the cost and quality of healthcare. ACOs are paid by the Medicare program to provide coordinated, comprehensive care for beneficiaries.

It is important to note that many ACO's are not publicly owned but rather privately owned. This means that they are not beholden to transparency laws like public companies are. This does not mean that all ACO's are misbehaving or breaking the law, but it does mean that it can be difficult for patients or other stakeholders who want more accountability from their provider organizations.

Episode Based Payments

Episode based payments are usually used in healthcare to ensure paying for the care provided. This kind of payment was implemented to help providers focus on providing high-quality care while focusing on managing their bottom line. It also helps shift the financial risk away from providers and onto the insurer, which is a significant shift in how our healthcare system has traditionally operated.

This payment model does not work for all providers, but it is advantageous for some. Providers with low prices or high volumes will be better suited for this type of payment model. For example, Medicaid would be better suited than Medicare because they have lower prices and higher volumes of people who need treatment.

Primary Care Transformation Model

Primary Care Transformation Model is a new model in healthcare that focuses on primary care. It aims to fill the gaps in the healthcare system and better coordinate care for patients.

The US spends more money on healthcare than any other country in the world, but it lacks a working primary care system. The Primary Care Transformation Model was developed to work on this problem and provide a solution for better coordination of care, fewer hospitalizations, and reduced costs.

The primary care transformation model is a framework that uses the patient’s history and biopsychosocial data to identify and address their needs. This framework is effective in managing chronic diseases such as diabetes, hypertension, and asthma.

GAVS Rhodium Framework for Payment Transformation in Healthcare

Post pandemic, healthcare is at crossroads and is looking for ways to transform itself. Value-based care, a model that prioritizes patient health quality outcomes versus patient services volume, has the potential to be the silver lining of this pandemic. In that context, healthcare should also transform towards alternative payment models like Total Cost of Care (ACO) and Episode-based Bundled Payments.

However, achieving the desired data maturity and the associated insights is not easy for current care due to legacy data platforms. In that context, GAVS, the best healthcare consulting firm in the US, Rhodium has all the building blocks and can be the one-time solution for healthcare to achieve the desired outcomes.